Welcome!

Agile Computing Authors: Elizabeth White, Zakia Bouachraoui, Mehdi Daoudi, Liz McMillan, William Schmarzo

Related Topics: Agile Computing

Agile Computing: Article

How Can Metcalfe's Law Be Updated for Web 2.0?

Metcalfe's Law is More Misunderstood Than Wrong

"Metcalfe's Law is Wrong," contended Bob Briscoe, Andrew Odlyzko, and Benjamin Tilly recently in a much-discussed IEEE Spectrum article, in which they wrote: "Of all the popular ideas of the Internet boom, one of the most dangerously influential was Metcalfe's Law." Sim Simeonov disagrees.

The industry is at it again – trying to figure out what to make of Metcalfe’s Law. This time it’s IEEE Spectrum with a controversially titled “Metcalfe’s Law is Wrong”. The main thrust of the argument is that the value of a network grows O(nlogn) as opposed to O(n2). Unfortunately, the authors’ O(nlogn) suggestion is no more accurate or insightful than the original proposal.

There are three issues to consider:

  • The difference between what Bob Metcalfe claimed and what ended up becoming Metcalfe’s Law
  • The units of measurement
  • What happens with large networks

The typical statement of the law is “the value of a network increases proportionately with the square of the number of its users.” That’s what you’ll find at the Wikipedia link above. It happens to not be what Bob Metcalfe claimed in the first place. These days I work with Bob at Polaris Venture Partners. I have seen a copy of the original (circa 1980) transparency that Bob created to communicate his idea. IEEE Spectrum has a good reproduction, shown here.

The original Metcalfe's Law graph

The unit of measurement along the X-axis is “compatibly communicating devices”, not users. The credit for the “users” formulation goes to George Gilder who wrote about Metcalfe’s Law in Forbes ASAP on September 13, 1993. However, Gilder’s article talks about machines and not users. Anyway, both the “users” and “machines” formulations miss the subtlety imposed by the “compatibly communicating” qualifier, which is the key to understanding the concept.

Bob, who invented Ethernet, was addressing small LANs where machines are visible to one another and share services such as discovery, email, etc. He recalls that his goal was to have companies install networks with at least three nodes. Now, that’s a far cry from the Internet, which is huge, where most machines cannot see one another and/or have nothing to communicate about… So, if you’re talking about a smallish network where indeed nodes are “compatibly communicating”, I’d argue that the original suggestion holds pretty well.

The authors of the IEEE article take the “users” formulation and suggest that the value of a network should grow on the order of O(nlogn) as opposed to O(n2). Are they correct? It depends. Is their proposal a meaningful improvement on the original idea? No.

To justify the logn factor, the authors apply Zipf’s Law to large networks. Again, the issue I have is with the unit of measurement. Zipf’s Law applies to homogeneous populations (the original research was on natural language). You can apply it to books, movies and songs. It’s meaningless to apply it to the population of books, movies and songs put together or, for that matter, to the Internet, which is perhaps the most heterogeneous collection of nodes, people, communities, interests, etc. one can point to. For the same reason, you cannot apply it to MySpace, which is a group of sub-communities hosted on the same online community infrastructure (OCI), or to the Cingular / AT&T Wireless merger.

The main point of Metcalfe’s Law is that the value of networks exhibits super-linear growth. If you measure the size of networks in users, the value definitely does not grow O(n2) but I’m not sure O(nlogn) is a significantly better approximation, especially for large networks. A better approximation of value would be something along the lines of O(SumC(O(mclogmc))), where C is the set of homogeneous sub-networks/communities and mc is the size of the particular sub-community/network. Since the same user can be a member of multiple social networks, and since |C| is a function of N (there are more communities in larger networks), it’s not clear what the total value will end up being. That’s a Long Tail argument if you want one…

Very large networks pose a further problem. Size introduces friction and complicates connectivity, discovery, identity management, trust provisioning, etc. Does this mean that at some point the value of a network starts going down (as another good illustration from the IEEE article shows)? It depends on infrastructure. Clients and servers play different roles in networks. (For more on this in the context of Metcalfe’s Law, see Integration is the Killer App, an article I wrote for XML Journal in 2003, having spent less time thinking about the problem ;-) ). P2P sharing, search engines and portals, anti-spam tools and federated identity management schemes are just but a few examples of the myriad of technologies that have all come about to address scaling problems on the Internet. MySpace and LinkedIn have very different rules of engagement and policing schemes. These communities will grow and increase in value very differently. That’s another argument for the value of a network aggregating across a myriad of sub-networks.

Bottom line, the article attacks Metcalfe’s Law but fails to propose a meaningful alternative.

More Stories By Simeon Simeonov

Simeon Simeonov is CEO of FastIgnite, where he invests in and advises startups. He was chief architect or CTO at companies such as Allaire, Macromedia, Better Advertising and Thing Labs. He blogs at blog.simeonov.com, tweets as @simeons and lives in the Greater Boston area with his wife, son and an adopted dog named Tye.

Comments (6)

Share your thoughts on this story.

Add your comment
You must be signed in to add a comment. Sign-in | Register

In accordance with our Comment Policy, we encourage comments that are on topic, relevant and to-the-point. We will remove comments that include profanity, personal attacks, racial slurs, threats of violence, or other inappropriate material that violates our Terms and Conditions, and will block users who make repeated violations. We ask all readers to expect diversity of opinion and to treat one another with dignity and respect.


IoT & Smart Cities Stories
While the focus and objectives of IoT initiatives are many and diverse, they all share a few common attributes, and one of those is the network. Commonly, that network includes the Internet, over which there isn't any real control for performance and availability. Or is there? The current state of the art for Big Data analytics, as applied to network telemetry, offers new opportunities for improving and assuring operational integrity. In his session at @ThingsExpo, Jim Frey, Vice President of S...
@CloudEXPO and @ExpoDX, two of the most influential technology events in the world, have hosted hundreds of sponsors and exhibitors since our launch 10 years ago. @CloudEXPO and @ExpoDX New York and Silicon Valley provide a full year of face-to-face marketing opportunities for your company. Each sponsorship and exhibit package comes with pre and post-show marketing programs. By sponsoring and exhibiting in New York and Silicon Valley, you reach a full complement of decision makers and buyers in ...
Two weeks ago (November 3-5), I attended the Cloud Expo Silicon Valley as a speaker, where I presented on the security and privacy due diligence requirements for cloud solutions. Cloud security is a topical issue for every CIO, CISO, and technology buyer. Decision-makers are always looking for insights on how to mitigate the security risks of implementing and using cloud solutions. Based on the presentation topics covered at the conference, as well as the general discussions heard between sessio...
In his keynote at 18th Cloud Expo, Andrew Keys, Co-Founder of ConsenSys Enterprise, provided an overview of the evolution of the Internet and the Database and the future of their combination – the Blockchain. Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life settl...
The Internet of Things is clearly many things: data collection and analytics, wearables, Smart Grids and Smart Cities, the Industrial Internet, and more. Cool platforms like Arduino, Raspberry Pi, Intel's Galileo and Edison, and a diverse world of sensors are making the IoT a great toy box for developers in all these areas. In this Power Panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists discussed what things are the most important, which will have the most profound e...
The Jevons Paradox suggests that when technological advances increase efficiency of a resource, it results in an overall increase in consumption. Writing on the increased use of coal as a result of technological improvements, 19th-century economist William Stanley Jevons found that these improvements led to the development of new ways to utilize coal. In his session at 19th Cloud Expo, Mark Thiele, Chief Strategy Officer for Apcera, compared the Jevons Paradox to modern-day enterprise IT, examin...
Rodrigo Coutinho is part of OutSystems' founders' team and currently the Head of Product Design. He provides a cross-functional role where he supports Product Management in defining the positioning and direction of the Agile Platform, while at the same time promoting model-based development and new techniques to deliver applications in the cloud.
There are many examples of disruption in consumer space – Uber disrupting the cab industry, Airbnb disrupting the hospitality industry and so on; but have you wondered who is disrupting support and operations? AISERA helps make businesses and customers successful by offering consumer-like user experience for support and operations. We have built the world’s first AI-driven IT / HR / Cloud / Customer Support and Operations solution.
LogRocket helps product teams develop better experiences for users by recording videos of user sessions with logs and network data. It identifies UX problems and reveals the root cause of every bug. LogRocket presents impactful errors on a website, and how to reproduce it. With LogRocket, users can replay problems.
Data Theorem is a leading provider of modern application security. Its core mission is to analyze and secure any modern application anytime, anywhere. The Data Theorem Analyzer Engine continuously scans APIs and mobile applications in search of security flaws and data privacy gaps. Data Theorem products help organizations build safer applications that maximize data security and brand protection. The company has detected more than 300 million application eavesdropping incidents and currently secu...